As reported this week by The Washington Post and The New York Times, the U.S. Federal Reserve has disclosed that it will continue preserving record low interest rates. Remaining cautiously optimistic as indicators have shown that the economic recovery is staying on track in recent months, the Fed’s policy-making committee stated that they would continue their stimulus campaign despite calls for swifter withdrawal.
The market appears to be mirroring the Fed’s stimulus campaign; early trading Thursday showed a 29 point raise (0.2 percent) for the Dow Jones industrial average, a further increase from the all-time closing high achieved on Wednesday. The Standard & Poor’s 500 index also showed growth, increasing four points (0.2 percent) to 2,006.
In addition to sharing how the low interest rates have boosted the market through energizing the economy and increasing stock appeal in comparison to bonds, the Fed stated that it would proceed with plans to end the recent bond-buying campaign after adding $15 billion to its holdings of Treasury and mortgage-backed securities in October.